The USDA’s World Agriculture Outlook Board Thursday raised its 2018 forecast for total US red meat and poultry production from last month.
Higher forecasts for broiler production more than offset lower beef, pork and turkey production, according to the World Agricultural Supply and Demand Estimates report.
BEEF PRODUCTION SEEN LOWER
The 2018 US beef production forecast was reduced to 27.725 billion pounds from 27,760 billion in the January report, as expected lower second-half beef production more than offsets higher first-half beef production. First-half beef production was placed at 13.745 billion pounds, while second-half beef production was forecast at 13.980 billion.
The WASDE report said the number of cattle placed on feed in the first part of this year was expected to be lower, resulting in lower marketings and beef production in the second half.
The USDA’s National Agricultural Statistics Service’s semi-annual Cattle Inventory report, released Jan. 31, reported the US cattle inventory continued to increase for the fourth straight year. However, the report also indicated that fewer numbers of cattle were being held outside feedlots.
The January NASS Cattle on Feed report showed year-over-year increases in feedlot placement numbers in December, implying higher numbers of fed cattle are likely to be marketed during the spring quarter.
Estimated slaughter cattle weights were raised for the first half of 2018 on current weight patterns. But even though weights may remain above a year ago, weekly slaughter weights likely will decline seasonally into late April or early May.
By that time, the bulk of the calves that were placed on feed in the fall will be worked through, and the industry will begin to harvest cattle that were placed as yearlings during the winter and early spring.
For 2018, beef export estimates were raised to 3.025 billion pounds from the January report’s 2.985 bullion as demand from several key trading partners was expected to remain robust. No change was made to the beef import forecast.
Fed-steer price expectations for 2018 were raised to $116 to $123 per cwt from $114 to $122 last month on continued demand strength.
PORK PRODUCTION ESTIMATE ALSO OFF
The 2018 pork production estimate also was reduced to 26.885 billion pounds from 26.960 billion in the January report on the pace of slaughter to date, the report said.
For 2017, production was placed at 25.581 billion pounds, down from the January estimate of 25.585 billion.
Pork import and export forecasts for 2018 were left unchanged from last month at 1.0 billion pounds and 5.9 billion pounds, respectively. However, the 2018 import estimate was down from 2017’s 1.116 billion pounds, and the 2018 export estimate was up from 2017’s 5.632 billion.
The 2018 hog price forecast was raised to $47-$49 per cwt from $46-$49 in the January report, mostly on estimated price performance in the first quarter, which was listed at $49-$51 on stronger prices to date.
CATTLE, BEEF RECAP
Only 126 head of fed cattle were sold Wednesday on the Livestock Exchange video auction at $126 per cwt. None were sold last week.
The USDA reported scattered sales in the Plains at $126.17 to $127 per cwt on a live basis, up $0.50 to $1 from last week, and a few on a dressed basis at a steady $200.
The USDA’s choice cutout Thursday was down $0.84 per cwt at $208.53, while select was up $0.65 at $203.79. The choice/select spread narrowed to $4.74 from $6.23 with 92 loads of fabricated product sold into the spot market.
The CME Feeder Cattle index for the seven days ended Wednesday, was $148.02 per cwt, down $0.08. This compares with Thursday’s Mar settlement of $147.25, down $1.05.